Abstract
Market segmentation is essential to target efficaciously core-segment customers and to obtain a competitive advantage. Firms when confronted by the range of market segments, have difficulty in deciding the core-segment customers who are the most probable purchasers of their product and services. We propose a novel fuzzy group multi-criteria method for market entry and segment evaluation and selection. This proposed method provides a comprehensive and systematic framework that combines bi-level multi-objective optimization with real option analysis (ROA) and fuzzy cooperative n-person game theory. The contribution of the proposed segment evaluation and selection method is fivefold: (1) it addresses the gaps in the marketing literature on the efficacious and effective assessment of market segments; (2) it provides a comprehensive and systematic framework that combines bi-level multi-objective optimization with ROA and fuzzy cooperative n-person game theory; (3) it considers fuzzy logic and fuzzy sets to represent ambiguous, uncertain or imprecise information; (4) it does not insist on consensus but synthesizes a representative outcome based on qualitative judgments and quantitative data; and (5) it is applicable to national and international market segmentation. The practical application of this proposed framework illustrates the efficacy of the procedures and algorithms.
Highlights
The rapid growth and importance of financial markets in the world economy has prompted governments in emerging market economies to initiate programs to develop their banking systems, banks and institutional and legal configuration to attract foreign banks to invest directly, especially where the banking system is a formerly state-owned activity
real option analysis (ROA) and fuzzy cooperative n-person game theory are used in a bi-level multiobjective optimization model for segment evaluation and selection
Successful market segment evaluation and selection is the essence of winning marketing strategies, and the bilevel model G proposed here is a useful method for achieving this success
Summary
The rapid growth and importance of financial markets in the world economy has prompted governments in emerging market economies to initiate programs to develop their banking systems, banks and institutional and legal configuration to attract foreign banks to invest directly, especially where the banking system is a formerly state-owned activity. Conventional MCDM methods tend to be less effective in eliminating imprecision and vagueness This led to the Technological and Economic Development of Economy, 2012, 18(3): 389–423 development of fuzzy set theory by Zadeh (1965). Peldschus and Zavadskas (2005) proposed a framework by combining fuzzy sets and matrix game theories for multi-criteria decision-making. The application of membership function of fuzzy set theory to bi-level multi-objective issue determination for satisfactory decisions was first introduced by Lai (1996).
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